Vedanta announces demerger plan to create six new companies

Vedanta is one of the largest generators of power and purchasers of renewable energy in the country now.
Vedanta chairman Anil Agarwal
Vedanta chairman Anil AgarwalFile Photo

MUMBAI: Vedanta group chairman Anil Agarwal has reiterated the plan to go ahead with the demerger of its businesses that will create six more new Vedantas in their own right.

The process will see Vedanta shareholders getting one new share in each of the five new companies for each of their equity now.

Addressing the shareholders at the annual general meeting on Wednesday, he said as of June 2024, the total shareholder return over the past five years is 276 per cent with an average accumulated dividend yield is 65 per cent in the same period, putting Vedanta in the top bracket of dividend payers.

The company has so far invested over $35 billion in the country and contributes around 1.4 per cent of the national GDP, he said, adding Vedanta is the largest private sector producer of oil, the largest producer of aluminium in the country and the sole producer of zinc and silver.

Vedanta chairman Anil Agarwal
India should maximise its potential in this area natural resources industry: Vedanta Chairman

Vedanta is also one of the largest generators of power and purchasers of renewable energy in the country now.

The group has over the past nine years contributed $53 billion to the national exchequer, he added.

“For every one share of Vedanta that a shareholder currently owns, she will additionally receive one share in each of the five newly listed companies,” he told the shareholders.

“The demerger will unlock massive value. Each demerged entity will chart its own course and will lend speed to our journey. Each entity will have more independence in regard to capital allocation and their growth strategies while investors will have the freedom to invest in the industries of their choice, broadening the overall investor base for Vedanta assets,” he said.

Noting that the natural resources industry has provided the very foundation for the growth and development of several developed global economies, he said with the right policy tweak, especially on the supply side, India can shine and maximize its potential in this area.

Vedanta is appropriately positioned in the global context too and the company will be netting as much as 70 percent of its topline from critical minerals in the future.

Reiterating his commitment to invest more in the country Agarwal said “Our investment in growth projects is substantial at $8 billion. These include our aluminium smelter, our alumina refinery, a copper smelter in Saudi Arabia, investment in new oil and gas blocks, and expansion of our steel and iron ore businesses.”

“As of now, 50 projects under execution with high potential for increasing volume, business integration, and enhancing the range of value-added products across businesses,” he added.

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